Blog

Rubles or rupees; yen or yuan; dollars or dinar. Every culture has its own currency which it trades for the things its denizens prize or need. Children, known for creating their own cultures—their own lingo, heroes, and social strata—are no different.

While, as adults and young adults, we attach value to dollars and cents, younger children ascribe as much value (or more) to the things they treasure most, often items which are non-monetary in nature. In days gone by, that might have been marbles or baseball trading cards. Today, it’s more likely an avatar for their favorite video game, a digital pet, or some other status symbol in their own realm. You can even get your child their own “digital license,” a driver’s license of sort for navigating the Internet that rewards them for their understanding of potential risks online.

Researchers studying the effects of incentives on learning, especially short-term incentives, are suggesting how best to leverage those non-monetary things kids value most (thus making these programs more cost-effective for schools and districts to administer) to motivate students to learn, reward them for their efforts, and in the process, boost attendance and retention levels in school.

What Do We Want? Motivation. When Do We Want It? Now.

Working together, researchers from the University of Chicago, University of Mannheim, and the University of California San Diego experimented with the effect of short-term incentives on student efforts and published their results in “The Impact of Short-term Incentives on Student Performance.” Drs. Steven D. Levitt, John A. List, Susanne Neckermann and Sally Sadoff tested the effects of low financial gain, high financial gain, non-monetary gain and the loss of their gains on some roughly 6,700 students in the Chicago, Illinois area. By announcing the incentives immediately before the tests were administered, the researchers eliminated the effects of preparation on performance. By modifying the rewards as either available immediately after taking the test or one month later, they could study which scenario—long-term or short-term—is most effective.

Although the effects varied by student body demographic, whether due to age or economic strata, the researchers were able to demonstrate that, while financial rewards were effective for older students, for younger students, non-financial awards were as effective, or in many cases, more effective, than low financial rewards (such as $10) or high rewards (such as $20) in their samples.

The takeaway from the study for educators and administrators is not only that short-term incentives work, but that something as inexpensive as a digital reward, which is easily dispensed and controlled, and affordably obtained, can be an effective means of incentivizing students to study harder, attend class more regularly, and stay in school as the value and benefit of their rewards increase over time.